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Tesla Missed Q1 Deliveries Target Due To Parts Shortages of Model X

April 6
5:30 AM 2016

Tesla managed to deliver 14,280 vehicles in the first quarter of 2016. Although the number shows 50 percent rise from Q1 in 2015, it did not satisfy the company's forecast of 16,000 units. The company blames parts shortages as the reason hampering the Q1 results.

The production issue that caused the company to miss its target specifically affects the Model X. "The delivery count was impacted by severe Model X supplier parts shortages in January and February that lasted much longer than initially expected," the company said in a press release.

The company elaborated the root of the parts shortage issue faced earlier this year. "Tesla's hubris in adding far too much new technology for the Model X in version 1, insufficient supplier capability validation, and Tesla not having broad enough internal capability to manufacture the parts in-house," the company wrote. The parts in question were just half a dozen out of more than 8,000 unique parts. However, a missing of even just one part hamper the company in delivering the cars. 

Tesla revealed that the issues have mostly been resolved by March. According to mlive, up to 750 Model X SUVS was being built per week by the last week of March. However, it was too late for many to be delivered by the end of the quarter, resulting in the decrease in Q1 deliveries. "Once these issues were resolved, production and delivery rates improved dramatically," the company wrote.

Even though the company missed its Q1 target, Tesla reiterated its commitment to deliver 80,000-90,000 vehicles in 2016, as reported by electrek. That means the company has to deliver at least 65,000 cars in the remaining 3 quarters of 2016. To achieve the yearly guideline, the automaker is also adding more details to its quarterly delivery number release.

The automaker founded by serial entrepreneur, Elon Musk, claimed that the company is addressing the root causes of parts shortage to ensure that these mistakes would not hamper the manufacturing and deliveries of the Model 3. According to MarketWatch, Tesla's Model 3 has been long-awaited by thousands across the globe ever since the company unveiled a prototype of the model last week. The company has received more than 276,000 reservations by Saturday.

Parts shortages faced by Tesla has caused the company to miss its target guidelines for the first quarter of 2016. However, the carmaker has already address the root of the problem, so that the same issue would not happen in the launch of the company's newest car model, the Model 3. 

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